STATE DEPT APPROVES KEYSTONE XL PIPELINE
The Keystone Pipeline System is an oil pipeline system in Canada and the United States, commissioned in 2010 and now owned solely by TransCanada Corporation. It runs from the Western Canadian Sedimentary Basin in Alberta to refineries in Illinois and Texas, and also to oil tank farms and an oil pipeline distribution center in Cushing, Oklahoma. The pipeline came to a greater prominence of attention when a planned fourth phase, Keystone XL, attracting growing environmental protest, became a symbol of the battle over climate change and fossil fuels, and in 2015 was rejected by then President Barack Obama. On January 24, 2017, President Donald Trump took action intended to permit the pipeline’s completion.
“While U.S. politics have changed in the past few months, some things haven’t: Keystone XL is still a climate disaster, it is still opposed by indigenous peoples from Alberta to Nebraska to the Gulf of Mexico, and it still will be fought tooth and nail,”
Clayton Thomas-Muller, Activist
“We’ve turned a new page under this administration. Gone are the days of the federal government needlessly holding back development of our natural resources and our infrastructure. Now we can begin to roll-back red tape and enact policies that create good-paying jobs in Oregon and across the nation,”
Greg Walden, U.S. Congressman
“We greatly appreciate President Trump’s Administration for reviewing and approving this important initiative and we look forward to working with them as we continue to invest in and strengthen North America’s energy infrastructure.”
Russ Girling, president of TransCanada
“Donald Trump likes to talk a big game when it comes to laying pipe, but landowners, native nations and climate activists aren’t going to let him get away with groping America,”
Stephen Kretzmann, Oil Change International
A new State Department report on the proposed Keystone XL oil pipeline finds that the project would have a minimal impact on the environment, an assessment likely to increase pressure on the White House to approve it. But the report sets no deadline for doing so.
NBC News (2014)
Last week, most people did not realize Exxon could stand to profit from the Keystone decision. In just 24 hours, the conflict of interest was pushed into the spotlight and the State Department announced publicly that Rex Tillerson had recused himself from the KXL decision.
The Keystone pipeline will stretch 875 miles from Alberta, Canada to Nebraska, where it will be connected to other pipelines already in place to deliver oil further south. It is expected to carry as many as 830,000 barrels of oil per day.
The pipeline is also expected to create 42,100 jobs, although only 35 will be permanent.
After green lighting the continuation of the controversial Keystone XL oil pipeline in an executive order January 24th, President Trump declared as recently as last week that the pipeline had to use American made steel “or we’re not building one.”
But on Friday, Trump spokeswoman Sarah Huckabee Sanders announced that the directive would apply only to new pipelines or those currently undergoing repair.
That sharp reversal now paves the way for the use of a stockpile of steel manufactured in Canada by a subsidiary of Evraz, a company in which Russian billionaire Roman Abramovich owns nearly a one/third stake.
Once the pipeline opens it would require only 35 full-time permanent jobs to run it, and 15 full-time temporary jobs, according to the state department report. TransCanada, the company seeking to build the pipeline, does not dispute those numbers.
Trump’s action could re-ignite protests, but “to what degree, we don’t know,” said Dallas Goldtooth of the Indigenous Environmental Network, which had been one of the main camp organizers before heeding the tribe’s call to leave last month. That group and other organizers have since called on Dakota Access opponents to spread out around the country rather than concentrate in southern North Dakota.
By providing a route to the Gulf Coast, Keystone XL could raise the price of tar sands oil. Among the oil companies that could benefit: Canada’s Suncor Energy Inc. and Canadian Natural Resources Ltd. and Texas-based Exxon Mobil Corp., whose former CEO, Rex Tillerson, is now the secretary of state. Tillerson recused himself from the pipeline decision.
A pipeline to Gulf refineries will make drilling in Alberta more attractive. The 2014 drop in oil prices hurt because production and processing are more expensive in the oil sands than in many other places. Last year Exxon wrote down the value of its Canadian reserves.
An already onerous environmental review and permitting process is stretched longer by environmental activists tying projects up in courts.
It’s nice to see that the State Department’s approval of Keystone XL re-establishes some certainty and sanity to a permitting process that was hijacked by political pandering.
However, Congress and the Trump administration need to implement reform so that projects in the future are not held up for years in regulatory paralysis or through litigation.
Modified: March 27, 2017
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